Pharmaceuticals industry is particularly dependent on US exports
Apart from capital goods producers, the pharmaceuticals industry is particularly
dependent on US exports. More than 18% of the sector’s total exports went to
the US in 2017, and the export ratio is very high, at 66.9%. While demand for
numerous medicines is not very price-elastic, US consumers might choose
domestic products if the US levied high import tariffs, seeing that the US
pharmaceuticals sector is competitive, too. Brexit has shown that consumers
may, indeed, take this route.
Chart 11 shows on the x-axis if and to what extent the share of the US in the
total exports of individual sectors deviates from the share of the US in
manufacturing exports as a whole. The y-axis shows to what extent the export
ratios of the individual sectors deviate from the average manufacturing export
ratio. Those sectors whose export ratio as a whole is above the average and
which ship an above-average share of their exports to the US can therefore be
found in the upper right quadrant. These are the sectors which would be hit
hardest by any restrictions to US trade.
EU Forecast
euf:ba.18.j:187/nws-01